w
w
ap
eP
m
e
tr
.X
w
CAMBRIDGE INTERNATIONAL EXAMINATIONS
om
.c
s
er
Cambridge International General Certificate of Secondary Education
MARK SCHEME for the October/November 2014 series
0452 ACCOUNTING
0452/13
Paper 1, maximum raw mark 120
This mark scheme is published as an aid to teachers and candidates, to indicate the requirements of
the examination. It shows the basis on which Examiners were instructed to award marks. It does not
indicate the details of the discussions that took place at an Examiners’ meeting before marking began,
which would have considered the acceptability of alternative answers.
Mark schemes should be read in conjunction with the question paper and the Principal Examiner
Report for Teachers.
Cambridge will not enter into discussions about these mark schemes.
Cambridge is publishing the mark schemes for the October/November 2014 series for
most Cambridge IGCSE®, Cambridge International A and AS Level components and some
Cambridge O Level components.
® IGCSE is the registered trademark of Cambridge International Examinations.
Page 2
1
Mark Scheme
Cambridge IGCSE – October/November 2014
Syllabus
0452
Paper
13
(a) B
(b) C
(c) C
(d) C
(e) C
(f) B
(g) B
(h) B
(i) A
(j) A
(1) mark each
[Total: 10]
© Cambridge International Examinations 2014
Page 3
2
Mark Scheme
Cambridge IGCSE – October/November 2014
(a) 1
2
3
Syllabus
0452
Invoice (1)
Debit note (1)
Statement of account (1)
Paper
13
[3]
(b) (i) Debit (1)
(ii) Cash discount (1)
(iii) For prompt payment (1)
[3]
(c)
Debit entry
Credit entry
$
$
1
Hal account
300
Sales account
300
2
Cash account
300 (1)
Hal account
300 (1)
3
Bank account
250 (1)
Cash account
250 (1)
4
Drawings account
400 (1)
Bank account
400 (1)
5
Bank account
600 (1)
Mabel account
600 (1)
[8]
(d) Transaction 3 (1)
[1]
(e) 620 (1) – 10 (1) = 610 (2)
OR
660 (1) – 100 (1) + 50 (1) = 610 (1)
[4]
(f) Current assets (1)
[1]
(g) Inventory
Trade receivables
Other receivables
Cash
Answer to be consistent with answer to (f)
Any 1 item (1)
[1]
[Total: 21]
© Cambridge International Examinations 2014
Page 4
3
Mark Scheme
Cambridge IGCSE – October/November 2014
Syllabus
0452
Paper
13
(a) A prepayment is an amount paid in advance for a service which has not yet been received
(1)
An accrual is an amount owed for a service which has been received but not yet paid for (1)
[2]
(b)
Insurance Account
$
2013
July 1 Balance b/d
Aug 2 Bank/Cash
$
180 (1)
2 340 (1)
2014
June 30 Income
Statement
Balance c/d
2 520
2014
July 1 Balance b/d
2 325 (1)OF
195
2 520
195 (1)CF
+ (1) dates
[5]
(c) (i) Profit and loss/expenses (1)
(ii) Accruals/matching (1)
[1]
[1]
(d) (i) Service business (1)
[1]
(ii) Sales/revenue/sales returns
Inventory (opening and closing)
Purchases/purchases returns
Carriage
Cost of sales
Goods for own use
Gross profit
Any 2 items (1) each
[2]
(e) (i) Prudence (1)
[1]
(ii) At the lower (1) of cost and net realisable value (1)
[2]
(f)
Scrap value 10 × $2
Less selling expenses
Net realisable value
$
20 (1)
7 (1)
13 (1)CF
[3]
© Cambridge International Examinations 2014
Page 5
Mark Scheme
Cambridge IGCSE – October/November 2014
Syllabus
0452
Paper
13
(g) (i) It is a record of what has happened in the past.
There is a gap between the year end and the preparation of the statements.
Items are recorded at cost so may not be realistic/difficult to judge effect of inflation.
May not know what policies the business is using so problems of comparison.
Only information which can be expressed in monetary terms in recorded – other
important factors are not recorded.
Different definitions can make comparisons difficult.
Or other reasonable comment
Any 1 comment (2)
[2]
(ii)
Income statement
Debit
Credit
Statement of financial
position
Assets
Liabilities
Bank overdraft
Depreciation charge for
the year
(1)
(1)
Prepaid rent
Discount received
(1)
Commission received
(1)
[4]
[Total: 24]
© Cambridge International Examinations 2014
Page 6
4
Mark Scheme
Cambridge IGCSE – October/November 2014
Syllabus
0452
Paper
13
(a)
Error
Affects balancing of trial balance
Does not affect balancing of trial
balance
1
(1)
2
3
(1)
4
(1)
(1)
5
[4]
(b)
Statement of corrected profit
Draft profit for the year
Error 1
Error 2
Error 3
Error 4
Error 5
Corrected profit for the year
$ .
26 800.
160.
1 000.
250.
No effect.
(600)
27 610.
(1)
(1)
(1)
(1)
(2)
(1)OF
[7]
(c) Error of commission (1)
[1]
[Total: 12]
© Cambridge International Examinations 2014
Page 7
5
Mark Scheme
Cambridge IGCSE – October/November 2014
Syllabus
0452
Paper
13
(a)
$
1 200
240
960
192
Cost
Depreciation year 1
Depreciation year 2
Total depreciation
$
240 (1)
192 (1)
432 (1)
[3]
(b)
2013
Jan
1
Aug 1
Balance b/d
Bank/cash
2014
Jan
1
Balance b/d
2013
June 1
Disposal
Dec 31 Balance c/d
Fixtures and fittings account
$
2013
31 200 (1)
June 1 Disposal
2 500 (1)
Dec
31 Balance c/d
33 700
$
1 200 (1)
32 500
33 700
32 500 (1)OF
Provision for depreciation Account
$
2013
432 (1)OF Jan
1 Balance b/d
13 916
Dec
31 Income Statement
14 348
2014
Jan
1 Balance b/d
$
9 702 (1)
4 646 ***
14 348
13 916 (1)OF
***Calculation of depreciation for the year
Cost of asset – Opening balance
Less disposal
Plus addition
Depreciation – Opening balance
Less disposal
$
31 200
1 200 (1)
30 000
2 500 (1)
9 702
432 OF
$
32 500
9 270 (1)OF
23 230
20% × 23 230 OF = 4646 (1)OF
Disposal account
$
2013
2013
June 1 Fixtures and Fittings 1 200 (1) June 1
Dec
Prov for Depreciation
Bank/Cash
31 Income Statement
1 200
$
432 (1)OF
600 (1)
168 (1)OF
1 200
[15]
© Cambridge International Examinations 2014
Page 8
Mark Scheme
Cambridge IGCSE – October/November 2014
Syllabus
0452
Paper
13
(c)
Ajith
Extract from Income Statement for the year ended 31 December 2013
$
Expenses
Loss on disposal of fixtures and
168 (1)OF
fittings
Depreciation – fixtures and fittings
4 646 (1)OF
Ajith
Extract from Statement of Financial Position at 31 December 2013
$
Non-current assets
Fixtures and fittings at cost
32 500 (1)OF
Depreciation to date
13 916 (1)OF
18 584
[4]
[Total: 22]
© Cambridge International Examinations 2014
Page 9
6
Mark Scheme
Cambridge IGCSE – October/November 2014
Syllabus
0452
Paper
13
(a) To obtain limited liability
To obtain extra capital
Any 1 reason (1)
[1]
(b) Preference share capital
[1]
(c) For reinvestment in the business
To plough back profits
To set aside profit for dividends in the future
If there is not enough actual cash available to pay a dividend
Any 2 reasons (1) each
[2]
(d)
ABC Limited
Profit for the year before interest
Less debenture interest
Profit for the year
$
15 000
1 500 (1)
13 500 (1)
XYZ Limited
Profit for the year before interest
Less debenture interest
Profit for the year after interest
$
15 000
8 000 (1)
7 000 (1)
[4]
(e)
ABC Limited
Appropriation Account for the year ended 31 December 2013
$
$
Profit for the year
13 500 (1)OF
Less Ordinary share dividend
7 800 (2)
(260 000 shares × $0.03)
12 800
Transfer to general reserve
5 000 (1)
Profit retained in the year
700
Retained profit b/f
29 300 (1)
Retained profit c/f
30 000 (1)OF
XYZ Limited
Appropriation Account for the year ended 31 December 2013
$
$
Profit for the year
7 000
Less Ordinary share dividend
3 100
(62 000 shares × $0.05)
Profit retained in the year
3 900
Retained profit b/f
14 100
Retained profit c/f
18 000
(1)OF
(2)
(1)
(1)OF
[11]
© Cambridge International Examinations 2014
Page 10
Mark Scheme
Cambridge IGCSE – October/November 2014
Syllabus
0452
(f) ABC has more equity
XYZ Limited has more long term loans/debentures/debt
ABC’s dividend paid is less expensive than XYZ’s loan interest paid
ABC paid a higher total dividend than XYZ
XYZ paid a higher total loan interest than ABC
ABC made a transfer to general reserve
Any 2 comments (1) each
Paper
13
[2]
(g)
ABC Limited
Statement of Financial Position at 31 December 2013
$
Non-current assets
100 000 (1)
Net current assets
80 000 (1)
180 000
Non-current liabilities
10% Debentures
15 000 (1)
165 000
Capital and reserves
Ordinary share of $0.50 each
General reserve
Retained profit
130 000 (1)
5 000 (1)
30 000 (1)OF
165 000
[6]
(h) Shares in ABC had a return of 6% (1) but shares in XYZ had a return of 5% (1)
ABC had a lower amount of loan capital (1) so less risky (1)
[4]
[Total: 31]
© Cambridge International Examinations 2014